The exploitation of backpackers on 417 working holiday visas in Australia has been criticized in a new report by the Fair Work Ombudsman (FWO).

The 417 visa is a temporary visa for young people who want to holiday and work in Australia. It is issued by the Department of Immigration & Border Protection (DIBP).

In order to stay in Australia for a second year on a 417 visa, a worker must undertake 88 days specified paid work in their first year in a designated regional area and in certain industries.

The Inquiry was established in August 2014 in response to a rising number of complaints from working holiday makers to the FWO.

It was also based on concerns that the 88 day requirement (which at the time need not have been paid work) was being exploited by some employers.

The FWO surveyed more than 4000 overseas workers who had been granted a second-year 417 visa after working in regional areas of Australia.

They found that 66% of foreign workers believe their employers would take advantage of people on working holiday visas by underpaying them.

The majority (59%) said that they would be unlikely to complain about their working conditions in case their work was not signed off by the employer.

Further, 35% of survey respondents said they were paid less than the minimum wage, 14% said they had to pay in advance to get regional work and 6% had to pay an employer to ‘sign off’ on their regional work requirement.

The Inquiry also identified worrying behaviour with respect to the treatment of 417 visa-holders, such as sexual harassment and workplace health and safety issues.

It also found employers engaging in sophisticated labour supply chains involving sham contracting, with visa-holders being engaged as contractors and not employees.

The report demonstrates how difficult it is to police 417 visa requirements and standards, said McDonald Murholme lawyer Sagorika Platel.

“There is no doubt that Australia needs backpacker labour secured by 417 working holiday visas,” said Platel.

“The policing of the visas must be more effective and easier by using existing regulators (e.g. the ATO).

“A simple spot audit by a small but permanent strike force within the ATO or Immigration office is needed but not a new government agency or department.”

Platel added that the enforcement is not being adequately done by the FWO as evidenced by its own report.

“It is not the role of the FWO to carry the burden for the immigration department and the ATO who have the resources and the knowledge of the 417 visas to enforce them,” said Platel.

“To leave the heavy lifting to the FWO means that the widespread breaches identified by the FWO may continue unchecked in the future as they clearly have done over recent years.”